Net Neutrality Threatens Telco Progress

May 22, 2006  •  Post A Comment

An escalating battle last week over the future of the Internet threatened to derail legislation that would make it easier for phone companies to get into the pay TV business.

The fight, pitting the nation’s major telephone and cable TV companies on one side against Google, Yahoo and other major Internet content providers on the other, is about the degree of power telephone and cable TV companies should have over the new broadband networks they are rolling out nationwide.

The telephone and cable TV companies want total control over their broadband destinies, which would allow them to charge Web sites for faster access to their broadband network subscribers.

But Google, Yahoo and their burgeoning legions of watchdog group allies want the federal government to approve so-called “network neutrality” legislation to ensure that telephone and cable TV companies can’t discriminate against independently owned Web sites.

Bills from both the House and Senate on the subject include provisions that industry critics charge lack teeth.

The measure by Sen. Ted Stevens, R-Alaska, essentially only requires the Federal Communications Commission to study the issue to see whether a problem develops. That measure was the subject of hearings before the Senate Commerce Committee last week.

During the hearings, Sen. Stevens’ provision was attacked by Sen. Barbara Boxer, D-Calif., and other committee Democrats in a move that could prompt Sen. Stevens to beef up the provision as part of a legislative rewrite.

“It’s very likely that [legislation easing phone entry into TV] could die over network neutrality,” said Sen. Gordon Smith, R-Ore.

In the Senate hearing’s wake, House Judiciary Committee Chairman Jim Sensenbrenner, R-Wis., and Rep. John Conyers, D-Mich., the committee’s ranking minority member, announced that they have introduced legislation that would bar telephone and cable TV industry discrimination.

Late last week, Sen. Olympia Snowe, R-Maine, and Sen. Byron Dorgan, D-N.D., introduced similar legislation in the Senate, with the support of Sen. Daniel Inouye, D-Hawaii, the ranking minority member on the Senate Commerce Committee.

Sen. Sensenbrenner’s legislation, which is scheduled for a Judiciary committee vote this week, requires phone and cable TV firms to offer similar Web sites the same terms of access.

“This legislation is a necessary step to protect consumers and other Internet users from possible anti-competitive and discriminatory conduct by broadband providers,” Rep. Sensenbrenner said in a statement.

“While I am not opposed to providers responsibly managing their networks and providing increased bandwidth to those consumers who wish to pay for it, I am opposed to providers giving faster, more efficient access to certain service providers at the expense of others,” he said.

Rep. Conyers added, “The measure which we are introducing today will ensure that the Internet continues to exist as an open and accessible medium where startups and businesses of all sizes can provide content and services reachable by all consumers.”

In a statement, Brian Dietz, a spokesman for the National Cable & Telecommunications Association, said that network neutrality legislation was a solution in search of a problem.

“This unnecessary regulation will stifle future investment and innovation in broadband networks and will result in higher consumer costs for broadband services, which could halt the remarkable growth and consumer adoption of broadband in the U.S.,” Mr. Dietz said.